Energy Giant Climbs After Earnings, Acquisition

Chesapeake Energy is acquiring Vine Energy in a deal valued at around $2.2 billion

Deputy Editor

Aug 11, 2021 at 10:27 AM

Chesapeake Energy Corp (NASDAQ:CHK) is in the spotlight today, after news that the company is acquiring sector peer Vine Energy (VEI) in a cash-and-stock deal valued at roughly $2.2 billion. Plus, Chesapeake Energy reported better-than-expected second-quarter earnings of $1.64 per share after the close yesterday, and raised its full-year production forecast. At last glance, CHK was up 2.2% at $56.71 -- earlier hitting a record high of $57.82.

Newly traded since exiting bankruptcy in early February of this year, today's highs have the stock surging past its mid-June peak of $56.99. Today's pop also has the security breaking past pressure at the $56 level, which it found after hitting a ceiling at the $55 mark for roughly a month. Now above a slew of short-term moving averages, the equity is up 12.2% in the last three months.

In response, Capital One Securities upgraded the stock to "overweight" from "equal weight." Coming into today, three of the five analysts in coverage already carried a "buy" or better rating on Chesapeake Energy stock, with two a "hold." Meanwhile, the 12-month consensus price target of $68 is a 21.4% premium to current levels.

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